Wages are usually charged either for hours worked or for the quantity of products produced. However, in some sectors of production it is more rational to carry out payments not for current indicators, but for the whole complex of works. In this case, a chord system of remuneration is suitable.
The essence of the chord system
The essence of this system is that payment is based on the total amount of work performed, regardless of the time spent on its implementation. The use of such a system is rational in construction, repair, research projects. Since the accord system of remuneration is characterized by temporary cost-effectiveness of work, it is also advisable to periodically introduce it at enterprises in cases where:
- the company does not fit into the contractual deadlines for the delivery of the object, while the violation of the contract threatens with significant fines;
- if necessary, eliminate emergency situations (fire, flood) that could lead to a halt in production;
- in case of industrial need for the introduction of new equipment, technologies.
Accord wage provides the following mechanism for the formation of the salary fund:
- main and auxiliary production processes are identified;
- the required amount of work is calculated;
- the time for its implementation is determined, and piecework rates are also displayed;
- calculated product of quotations for the amount of work on the list;
- the amount of the required salary is determined by adding the payments for each item.
The salary fund is allocated to the entire team (team) and is distributed within it at piece-rates, fixed in the contract tariffs or coefficient of labor participation. The method of distribution of earnings, the amount of payment, the list of works to be completed and the deadlines for the delivery of the order are recorded in labor contracts concluded between the employees and the customer company.
Types and features of the system
A chord pay system can be simple and premium. In the first case, salaries are accrued at predetermined fixed rates for the amount fulfilled, regardless of other additional conditions and factors. In the second case, it is allowed to accrue premiums, for example, for shortening deadlines, for saving materials, for high-quality performance of especially complex works, etc.
In addition, a chord system of remuneration can be individual, that is, established for one specific employee, or collective for a whole brigade (site).
When applying the brigade payment method, the employer must provide employees with a number of conditions:
- the availability of the proper amount of work prescribed in the contract;
- necessary technical and instrumental support;
- timely and adequate supply of energy sources (electricity, gas);
- creation of comfortable and safe working conditions (providing work clothes, conducting light, heat, water, observing employees' rights to rest and lunch break).
The chord system of remuneration does not relieve the employer of the obligation to pay salaries twice a month: in advance and in the form of the total amount. Therefore, in the employment contract, it is necessary to provide for interim salary payments if the production process lasts more than a month. It is also worth considering that in case of dismissal of an employee and non-fulfillment by him of the full amount of chord work, the advance paid is not refundable. Therefore, it is necessary to pay salaries on the basis of the work order and acts of work performed for actually performed volumes. Compensation under a chord system cannot be less than the minimum wage adopted in the region (or country).